Erie Indemnity Co. Files Q2 2024 10-Q

TL;DR

ERIE 10-Q filed. Q2 financials out, showing revenue from policy services and admin fees. Check it for details.

AI Summary

Erie Indemnity Co. filed its 10-Q for the period ending June 30, 2024. The filing details financial performance for the second quarter and the first half of the year, including revenues from policy issuance and renewal services, and administrative services. Specific dollar amounts and comparative periods are provided within the detailed financial statements.

Why It Matters

This filing provides investors with an update on Erie Indemnity's financial health and operational performance, crucial for understanding the company's current standing and future prospects in the insurance sector.

Risk Assessment

Risk Level: low — This is a routine quarterly filing providing financial updates, not indicating any immediate or significant new risks.

Key Numbers

• 2024 Q2 — Reporting Period (Financials for the second quarter of 2024 are detailed.)
• 2024-01-01 to 2024-06-30 — Year-to-Date Period (Financials for the first six months of 2024 are detailed.)

Key Players & Entities

• ERIE INDEMNITY CO (company) — Filer of the 10-Q
• 20240630 (date) — End of reporting period
• 20240725 (date) — Filing date
• PA (location) — State of incorporation
• 100 ERIE INSURANCE PLACE (address) — Company's business and mail address

FAQ

Key Financial Figures

• $0.0292 — t: Class A common stock, stated value $0.0292 per share ERIE NASDAQ Stock Market, LLC

Filing Documents

• erie-20240630.htm (10-Q) — 1866KB
• ex-31106302024.htm (EX-31.1) — 15KB
• ex-31206302024.htm (EX-31.2) — 15KB
• ex-3206302024.htm (EX-32) — 9KB
• 0000922621-24-000019.txt ( ) — 9668KB
• erie-20240630.xsd (EX-101.SCH) — 45KB
• erie-20240630_cal.xml (EX-101.CAL) — 110KB
• erie-20240630_def.xml (EX-101.DEF) — 312KB
• erie-20240630_lab.xml (EX-101.LAB) — 597KB
• erie-20240630_pre.xml (EX-101.PRE) — 426KB
• erie-20240630_htm.xml (XML) — 2102KB

Financial Statements (Unaudited)

Financial Statements (Unaudited)

Notes to Financial Statements – June 3 0 , 2024

Notes to Financial Statements – June 3 0 , 2024 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk Item 4.

Controls and Procedures

Controls and Procedures PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings Item 1A.

Risk Factors

Risk Factors Item 2. Unregistered Sales of Equity Securities and Use of Proceeds Item 6. Exhibits

SIGNATURES

SIGNATURES 2 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS ERIE INDEMNITY COMPANY (dollars in thousands, except per share data) Three months ended June 30, Six months ended June 30, 2024 2023 2024 2023 Operating revenue Management fee revenue - policy issuance and renewal services $ 760,886 $ 633,339 $ 1,426,572 $ 1,191,429 Management fee revenue - administrative services 17,051 15,636 33,985 30,825 Administrative services reimbursement revenue 206,028 184,466 397,595 357,293 Service agreement revenue 6,473 6,429 12,987 12,788 Total operating revenue 990,438 839,870 1,871,139 1,592,335 Operating expenses Cost of operations - policy issuance and renewal services 594,202 521,246 1,144,524 990,341 Cost of operations - administrative services 206,028 184,466 397,595 357,293 Total operating expenses 800,230 705,712 1,542,119 1,347,634 Operating income 190,208 134,158 329,020 244,701 Investment income Net investment income 16,010 13,535 31,913 15,718 Net realized and unrealized investment (losses) gains ( 1,795 ) ( 1,737 ) 58 ( 7,019 ) Net impairment losses recognized in earnings ( 388 ) ( 171 ) ( 3,065 ) ( 1,804 ) Total investment income 13,827 11,627 28,906 6,895 Other income 3,292 3,305 6,703 6,642 Income before income taxes 207,327 149,090 364,629 258,238 Income tax expense 43,424 31,238 76,174 54,145 Net income $ 163,903 $ 117,852 $ 288,455 $ 204,093 Net income per share Class A common stock – basic $ 3.52 $ 2.53 $ 6.19 $ 4.38 Class A common stock – diluted $ 3.13 $ 2.25 $ 5.52 $ 3.90 Class B common stock – basic and diluted $ 528 $ 380 $ 929 $ 657 Weighted average shares outstanding – Basic Class A common stock 46,189,042 46,189,026 46,189,028 46,188,923 Class B common stock 2,542 2,542 2,542 2,542 Weighted average shares outstanding – Diluted Class A common stock 52,305,299 52,299,974 52,303,551 52,298,298 Class B common stock 2,542 2,542 2,542 2,542 Dividends declared per share Class A common stock $ 1.275

NOTES TO FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO FINANCIAL STATEMENTS (UNAUDITED) Note 1. Nature of Operations Erie Indemnity Company ("Indemnity", "we", "us", "our") is a publicly held Pennsylvania business corporation that has since its incorporation in 1925 served as the attorney-in-fact for the subscribers (policyholders) at the Erie Insurance Exchange ("Exchange"). The Exchange, which also commenced business in 1925, is a Pennsylvania-domiciled reciprocal insurer that writes property and casualty insurance. Our primary function as attorney-in-fact is to perform policy issuance and renewal services on behalf of the subscribers at the Exchange. We also act as attorney-in-fact on behalf of the subscribers at the Exchange with respect to all claims handling and investment management services, as well as the service provider for all claims handling, life insurance and investment management services for the Exchange's insurance subsidiaries, collectively referred to as "administrative services". Acting as attorney-in-fact in these two capacities is done in accordance with a subscriber's agreement (a limited power of attorney) executed individually by each subscriber (policyholder), which appoints Indemnity as each subscriber's attorney-in-fact to transact certain business on their behalf. In accordance with the subscriber's agreement for acting as attorney-in-fact in these two capacities, we retain a management fee calculated as a percentage of the direct and affiliated assumed premiums written by the Exchange. The policy issuance and renewal services we provide on behalf of the subscribers at the Exchange are related to the sales, underwriting and issuance of policies. The sales related services we provide include agent compensation and certain sales and advertising support services. Agent compensation includes scheduled commissions to agents based upon premiums written as well as incentive compensation, which is earned by achieving targeted measures. The underwriting services we provide include u

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